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Volume 301: debated on Tuesday 25 November 1997

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If he will make a statement on the United Kingdom's relations with Japan. [15994]

The United Kingdom enjoys excellent relations with Japan, which we regard as a special partner. Japan is our largest export market in Asia and a major inward investor in the United Kingdom. We work closely with Japan on a wide range of subjects, including joint science and technology projects, international peacekeeping, commercial collaboration in third markets and joint aid projects. There are also growing ties between the British and the Japanese people. We want to build closer relations in the future. The visit of my right hon. Friend the Prime Minister to Japan, in January, will be an important step towards that objective.

I thank my hon. Friend for his response. Will he confirm that future relations between the United Kingdom and Japan will be strengthened by an open acknowledgement by the Japanese Government of the crimes of the past? Will the Government and the Prime Minister, on his visit next year, continue to press for full appropriate compensation for Japanese labour camp victims and civilian internees? Does he acknowledge that full compensation is the basis for a stronger, better and more fruitful relationship in the future?

Since the Labour party was elected in May, I have had several meetings with representatives of the former prisoners of war. My right hon. Friend the Foreign Secretary and I have also had a series of meetings with Japanese Ministers and officials and we have suggested possible ways in which the wartime sufferings of the former prisoners of war could be recognised and acted on. I am sure that all right hon. and hon. Members welcomed the gesture by the Japanese ambassador in attending the Remembrance day service at Coventry cathedral the other week. That was a warming gesture of reconciliation and I hope that we can build on it in the next few months.

Do not events earlier today in Japan raise some profound questions about the issue of security? Is it not the case that, for a country such as the United Kingdom, economic turbulence—of the kind seen in Japan—is likely to be as disadvantageous as military threats? In the light of those circumstances, what measures have the Government urged on the Japanese Government, as a fellow member of the Group of Eight, as a means of restoring economic confidence in the domestic Japanese economy?

We all recognise the global significance of the events in south-east Asia, and Japan and Korea. We know that the Governments in the region are working closely with the International Monetary Fund and others, which is the right approach to open up their trade, to liberalise their markets and to take some of the measures that are crucial for their long-term financial and economic security.

One lesson that we must learn from the Japanese experience—much reinforced to me last week when I spoke to inward investors from Japan—is that, if we follow the Conservative party's European policies, Japanese inward investors will cut their investment in the United Kingdom. Every Japanese company that I visited told me that Conservative policies would put tens of thousands of jobs at risk.

I very much welcome what my hon. Friend has just told the House. Does he share the concern of my constituents in Dunfermline, and people elsewhere in the United Kingdom, who have benefited from inward investment from south-east Asia? What measures will the Foreign Office take to ensure that we remain an attractive destination for investment by Japan, South Korea and other south-east Asian countries?

There was no doubt, during my discussions with Japanese and Korean inward investors last week, that the United Kingdom remained an attractive location. We have become even more attractive since 1 May, because inward investors know that we have political stability, and that we are committed to Europe and intend to be a central part of it. The messages from the previous Government were a strong disincentive to inward investment.

I am sure that the Minister is right that one of the reasons why Japanese companies invest in Britain is our membership of the European Union. What steps will the Minister take to reassure inward investors that the very advantages that they see in investing in Britain—more flexible labour markets—will not be eroded by following the European social model?

Not one Japanese company mentioned that to me last week. They saw attractive propositions in the United Kingdom and they will continue to look to this country as a suitable location for inward investment. If the right hon. Lady had a strong message on Europe, it would be attractive to Japanese companies. My wish for her is that she could win more support in her party, but she is sadly isolated in her beliefs.